It was in the fall that my wife and I set financial goals for ourselves for the next few years. Every couple of months, I like to write an update on our progress. I wrote my recent progress on our financial goals a couple months ago, which was actually the second update in this series. For those who weren’t reading my blog when I set my goals in the fall, here are the goals that I set out to accomplish in the next 2-3 years. It’s already been about 8 months since I have set my goals. While I am happy with my progress so far, I have a lot to do.
- Open and maximize yearly contributions to Roth IRA for both of us
- Start contributing to 403(b) for both of us (I’m eligible to participate starting in the Spring)
- Get Life Insurance
- Increase net worth by 50% (this is easy to do when your networth is low )
- Finish Graduate School Debt Free (next December!!)
- Pay for Mrs. 20′s Graduate Degree in cash (She applied to start in January, more details to come)
- Build enough passive income to retire – Yes, I want to “retire” in 2-3 years. This is part of my early retirement plan.
As I mentioned last time, I already checked off numbers 1, 2, and 3. We are strong believers in saving for retirement with a Roth IRA, especially for people who are still in their 20’s. I have enough money in my savings to dump into our Roth IRA’s for the 2012 calendar year, but I am waiting for the right moment. So, technically, I haven’t maxed out our yearly contributions for 2012 yet – but I will soon. Right now it’s sitting in my high yield savings account until I decide to invest it.
I just recently qualified for my employer’s 403(b) plan and have been putting money there in addition to our Roth IRAs. Money has been going in there for almost 5 months now, and I am happy to see that money build up.
Lastly, as I already wrote about separately, I got whole life insurance. You can read the article if you want to know more about why I chose this form of insurance over term life. I think it’s important to consider because most financial advisors and bloggers suggest term life over whole life. The alternative exists for a reason and you should at least consider if it is right for you. It is really affordable for the coverage that I have and I don’t need to make another payment until this fall. (October, I believe).
Financial Goals Still In Progress
My wife and I have been great at saving money each and every month. With the new addition of my 403(b) account and additional savings, our net worth has been slowly increasing. If I had to guess, I think we might be able to reach our goal of +50% by the end of the year.
I am now working on my Thesis, the last requirement for my graduate school. Technically, I am not writing it yet, but I will be soon. I hope to get it done sooner rather than later so that I don’t have to stress about it, but we’ll see how that plays out. I have become quite good at writing over the past 9 months (thanks to blogging) and I don’t expect a problem getting the content out on paper once I have done the research and have my outline in place.
My wife and I have been talking about moving at some point in the future. One of the reasons why we have decided to stick around for the next couple of years is because she will be finishing up with her graduate school. In order to finish her degree in two years (as opposed to three), she will now be taking 2 classes per semester instead of one. This not only means that she will be busy, but also will cost us more money each year. Nearly double the cost. This means we won’t be able to save as much money, but I still plan to pay for it in cash as we go along. You can read about how we pay for both of our graduate degrees in cash instead of loans.
Lastly, I am still building up my side income, but it will be a while before I can determine if I will be able to quit my day job any time soon. I haven’t been focusing on this goal as much because we have been quite busy. I hope to work on a few new business ideas that I have been thinking about and implement them in the next year or so. One of them has the potential to make a lot of money if I can market it correctly. Stay tuned for more updates about these.
Similar to my last update, I have realized how hard it is to stay motivated with the same goals. Having financial goals definitely motivates me and keeps me on track to prioritize my spending. I enjoy looking at a long-term goal and finding out what I need to do to reach that goal. I got a little sidetracked for a month or so, but with my wife taking more classes now (and costing us more money each semester), I am motivated again to see what expenses we can cut out to reach our goals. I can’t wait to check off a couple more of our goals in the coming months. Stay tuned for more updates!